President Trump said on Tuesday that the US would provide insurance and naval escorts for tankers transiting the Strait of Hormuz after Iran’s Islamic Revolutionary Guard Corps (IRGC) declared the waterway was closed, a response to the US and Israeli attack on Iran.
“Effective IMMEDIATELY, I have ordered the United States Development Finance Corporation (DFC) to provide, at a very reasonable price, political risk insurance and guarantees for the Financial Security of ALL Maritime Trade, especially Energy, traveling through the Gulf. This will be available to all Shipping Lines,” Trump wrote on Truth Social.
“If necessary, the United States Navy will begin escorting tankers through the Strait of Hormuz, as soon as possible. No matter what, the United States will ensure the FREE FLOW of ENERGY to the WORLD,” the president added.
Oil shipments that transit the Strait of Hormuz account for about 31% of the world’s seaborne crude, and the waterway’s effective closure and the regional instability caused by the war have already driven up oil prices.
Ebrahim Jabbari, an advisor to the commander of the IRGC, has warned that Iranian forces will attack any ship that tries to transit the Strait of Hormuz. “The strait is closed. If anyone tries to pass, the heroes of the Revolutionary Guard and the regular navy will set those ships ablaze,” Jabbari said.
Several tankers have been hit by drones since the US and Israel launched the war, and leading maritime insurers have begun canceling war risk insurance coverage for ships operating in the Gulf.
